By Kirk Maltais

 

--Wheat for March delivery fell 1.4% to $6.75 3/4 a bushel on the Chicago Board of Trade Thursday, in reaction to low export sales, precipitation in South America, and overall choppiness in commodities trading.

--Soybeans for March delivery fell 1.3% to $14.07 1/2 a bushel.

--Corn for March delivery rose 1.3% to $5.49 3/4 a bushel.

 

HIGHLIGHTS

 

Missed Mark: Grain futures slipped Thursday, after the USDA reported grain export sales that were lower than trader forecasts -- with soybean sales of only 238,700 metric tons across both the 2020/21 and 2021/22 marketing years. Corn sales totaled 599,200 tons and wheat sales tallied 182,500 tons. China was absent from large buying for the week ending Feb 18, due to the Lunar New Year holiday.

Easy Money Over?: Weak export sales and some much-needed rain in Argentina pressured grain futures added jitters to trading today. "The heightened volatility in a host of commodity/financial markets is causing investor pause," said AgResource. "Advisors argue that the easy money has been made in commodity and equity markets. The extra volatility adds to market risk and traders should be reducing their positions."

 

INSIGHT

 

Rationing Realized: The low export sales reported by the USDA prompted thoughts among traders that demand rationing was finally starting to take hold. "Disappointing sales across the board with the market potentially signaling it is starting to do the necessary job of slowing down demand," said Doug Bergman of RCM Alternatives. This sentiment sank grain futures Thursday, and may pressure grains going forward.

Where's China?: Some grain traders are beginning to wonder whether China will go back to buying large quantities of U.S. corn now that the Lunar New Year is over. "It's no secret that we've been skeptical of China's corn demand," said Arlan Suderman of StoneX. "Logic says they would import corn to fill that deficit. However, leaders in the Chinese Communist Party have instead filled it with wheat reserves, and imports of grain sorghum and barley."

Rollin' On The River: Barges operating in the U.S. are slowly returning to their normal workload after last week's bitterly cold temperatures in the Midwest, according to the USDA. "Ice storms and other severe weather temporarily halted barge operations on the Mississippi River around St. Louis, as well as on the Ohio River, Illinois River, and Lower Mississippi River areas," the government said in its weekly Grains Transportation Report. "As of February 25, most grain barges have resumed operations, except for those on the Illinois River. Minor delays persist, but no major disruptions are expected." For the week ending Feb. 20, barge shipments slipped by 28% from the previous week, the USDA said.

 
AHEAD 
 

--The USDA will release its monthly agricultural prices report at 3 p.m. ET Friday.

--The CFTC will release its weekly commitment of traders report at 3:30 p.m. ET Friday.

--The USDA will release its weekly export inspections report at 11 a.m. ET Monday.

--The USDA will release its monthly grains crushing report at 3 p.m. ET Monday.

 

Write to Kirk Maltais at kirk.maltais@wsj.com

(END) Dow Jones Newswires

February 25, 2021 15:49 ET (20:49 GMT)

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